Currently, no one has solved the problem how to “own” digital content. That is, once some intellectual property like music or video is digitized; it may be reproduced without degradation many times over. In essence, the problem is applying those qualities of “tangible ownership” to digital works: universal uniqueness; universal identity; uniqueness of instance; transferability of control.
Current existing mechanisms and methods for digital content purchasing or renting can be broken into two main categories: streaming distributions that require the end-user to maintain a live network connection, or those that link content to non-securable digital distribution media. Examples of the former include the Cable and Wireless, Inc., and Real Networks, Inc. Examples of the latter include: Compact Disc [CD] and Digital Versatile Disc [DVD]. Both of these storage media formats are decodable and reproducible using publicly-available products.
In the first existing category, the digital content is “streamed.” For example, the Microsoft content store U.S. Pat. No. 6,055,314, is a streaming distribution model using a local hardware device for customer authentication. Here, streaming refers to serialized bit streams transmitted across a digital carrier [network]. These streams are then decoded and presented in human-consumable format to a video display or an audio player. This model is very similar to broadcast TV or Radio in that the data stream is ephemeral—once it is played it is gone. This method is most similar to Video-on-Demand (VOD) services. An alternative variation of this model is the MovieLink, Inc. stream and buffer approach. Here, the content is streamed, but also stored locally on a computer hard drive.
The second existing, and more prevalent distribution category, is via digital storage media (e.g., DVD, Music CD, etc.). In this model, the consumer owns or rents the digital storage media containing the desired digital content. So, rather than an ephemeral stream that is experienced on a per-use basis; the consumer may access the content in whatever order or schedule they wish. An alternative variation to this model is the MP3.com content store U.S. Pat. No. 6,609,105. In this invention, the content is stored in a central repository, but requires a customer to possess the original digital media in order to access the digital content.
The drawbacks of the “streamed” model of digital content distribution are:                Once the digital content play has started, it is difficult and unwieldy to stop and start again.        The customer is tied to the broadband distribution network. This prevents a streaming solution from being easily portable.        This method is susceptible to network congestion and interruption, which dramatically degrade the quality of playback. Though broadband networks are widely available, network traffic slowdowns and burstiness are notorious problems.        There is no concept of ownership with this model. The content is purchased on a per-use basis.        This model is inappropriate for non-video or non-music content. For example, software application content can not be streamed. By its very nature, it must be present within a computer's memory and available in its totality.        
The disadvantages to the MovieLink.com “stream and buffer” distribution model are:                This is a video-only solution.        This is a rental-only model. There is no provision for enforcement of ownership.        This model allows the content to be available in raw digital form, making it susceptible to unauthorized distribution        This model provides no support for rich content upgrades, for example HDTV-format video.        
The drawbacks of digital storage media distribution are:                Distributable media solutions have proven insecure and easy to pirate and duplicate.        As content reproduction technology advances, customers must re-equip their consumer electronics. Also, standing inventories will be made obsolete and un-sellable.        If the physical media is damaged, access to the content is lost and the content and distribution media must be re-purchased.        
The disadvantages of the MP3.com central repository requiring the original digital media are:                This content in this model is not uniquely encrypted and is subject to unlawful distribution.        This model allows the content to be available in raw digital form, making it susceptible to unauthorized distribution        This model provides no support for rich content upgrades, for example DVDA-format high-fidelity audio.        
It is therefore an object of the invention to provide a means and supporting apparatus to define and manage the actual “ownership” of digital content
It is another object of the invention to support a set of business methods to enable online and retail-based transactions for the sale and rental of digital content
It is another object of the invention to provide a means and apparatus for alternative embodiments of digital content purchase and rental transaction models to support third-party and wholesale business models
It is another object of the invention to provide a means and apparatus for management of owned or rented digital content to improve the customer experience through ease of use and enhanced inventory access and control